TAXATION AND LAND VALUES.

Manawatu Standard, Volume XLIV, Issue 1180, 1 December 1924, Page 6

TAXATION AND LAND VALUES.

(To the Editor.)

Sir, —Under the abovo heading on October 16th you deal at some length with theso very important questions. Although several of.'.your statements are open to question, tho one I take most exception to is this: “Actually, tho land tax acts as a tax on production and, in a country which must largely depend for its wealth upon the products of the soil, it is a mistake to handicap the primary producer by taxing his land. The only equitable line of taxation is found in tho income tax, which should, however, bo based bn the actual profits of the farm. The land tax should be confined to lands held purely for speculative purposes,” etc! Now, sir, I shall endeavour to show, you how income tax works out, as against land tax. I will quote two average farmers getting average prices for their products. No. 1. —1000 acres, medium sheep country, carrying 3000 sheep all the year round; producing CO bales of wool at £2O per bale—£l2oo; profit on sale of sheep, £.500; total income £I7OO. Expenses: Two men’s wages and keep. £450; shearing, etc., £GO; repairs, .fencing, etc., £SO; total expenses, £560; net income £ll4O. No. 2, 250 acres, same quality land, carrying 100 cows, producing 25,0001 b of butter-fat at Is Cd per lb, £1875; pigSj £100; calves, £100; total income £21)75. Expenses: Two men’s wages and keep. £450; repairs, etc., £SO; total expenses, £500; net income £1575.

Now, sin No. 1 farmer, doing very little work, earns £1 2s 9UI per acre, and No. 2 earns £6 6s per acre. Yet you say tliat “land tax is a tax on production.” I say that it is the only fair and equitable way to tax land owners, increasing the tax as the area increases, to prevent our better classes of land from being held in too large areas.

■ Supposing ill Is 1250 acres of land belonged to you. sir, and it bad just been burnt anil sown down and these two men offered to lease it from you, or even to buy it, you would not dream of asking the man that wanted 250 acres more rent per acre than the other, or a bigger price per acre to sell outright. Then why should the State ask more because one man is working harder than the other Y And, of course, the smaller the area the higher the rate of earnings. 1 hoard only the other day of a farm of 78 acres producing £I4OO for the year; running to the factory. 1 shall await your reply in defence of the income tax with much interest. Apologising for taking up so much of your valuable space, —l am, etc., SMALL FARMER.